Discussion
The credit control methods adopted by RBi includes:
Answer: D
Correct answer: a &b
The Reserve Bank uses both kinds of control and they answer different questions. Quantitative controls act on the volume of credit in the system without regard to its destination - the bank rate, the cash reserve ratio, the statutory liquidity ratio and open market operations.
Qualitative or selective controls act on its direction: margin requirements on particular securities, ceilings on credit for a specified purpose, differential rates for certain advances, and moral suasion. "Fixed control" is not a category in monetary policy at all, which is what leaves the first two.
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